UPDATE 1-Public Storage says sold Shurgard Europe stake

(New throughout; Adds detail and background on deal)

NEW YORK, March 31 (Reuters) - Public Storage (PSA.N: Quote, Profile, Research, Stock Buzz), owner and operator of self-storage facilities, said on Monday it sold 51 percent of its Shurgard Europe operations to the New York Common Retirement Fund for 383.2 million euros ($606 million), plus a closing adjustment.

Public Storage will retain a 49 percent interest and manage a newly formed joint venture that will own Shurgard Europe. The existing Shurgard Europe management team will continue operating out of Brussels.

The new JV includes Shurgard's 20 percent interest in two existing ventures, which are the subject of previously disclosed arbitration. If these interests can be acquired, they may be incorporated into the newly formed JV, Public Storage said.

PSA in January had announced it reached an agreement to sell a majority stake in the European operations to an unidentified buyer. At the time, PSA said the proceeds were on par with what they had expected from a canceled European share offering in the business. (Reporting by Joseph A. Giannone; Editing by Braden Reddall)